Dubai Group, a unit of the emirate's ruler's personal investment firm currently restructuring US$6bn in debt, saw an offer of 18.5 cents for every dollar rejected in favour of full repayment over a 12-year period by around 20 banks, Bloomberg reported.

The 20 banks were part of a group of lenders that had provided the investment firm a US$1.5bn Islamic murabaha loan in 2008. The offer was extended to the banks after earlier being accepted by a separate group of four lenders, including Royal Bank of Scotland and Standard Chartered, which recently dropped arbitration proceedings against Dubai Group.

A spokesperson for Dubai Group declined to comment on the latest 18.5 cents per dollar offer.

Dubai Group was hit hard by the global financial crisis in 2008 due to excessive use of leverage in its investments and a sharp decline in asset values.

After missing interest payments on two loan facilities in 2010 it spent years trying to persuade its lenders to extend repayment deadlines so that its asset values could have time to recover before it was forced to sell them to pay back debts.

The Dubai government walked away from negotiations in January 2012, dashing hopes of state-backed aid.

Of Dubai Group's US$10bn total debt, US$6bn is owed to banks and the remaining $4bn is classed as inter-company loans.